Givaudan impresses with 9-month results
Global scent and flavour maker Givaudan released earnings for the first nine months of the year this week, and they brought a smile to investors’ faces. Strong sales beat forecasts, and Givaudan claimed that it was successfully raising prices to compensate for the increased cost of ingredients necessary in making its products. It’s also made a successful entry into the ‘naturals’ space – an increasingly popular market, as consumers continue the trend towards ‘organic’ and ‘natural’ ingredients – through the acquisition of Naturex.
Givaudan’s share price surged on strong earnings so far this year
SOURCE: Yahoo Finance
Givaudan said that sales in the third quarter rose by 9.8% against the same period in the previous year. That amounted to 1.41 billion Swiss francs – a small beat against analysts’ expectations of 1.37 billion francs. For the full nine months of the year-to-date, Givaudan said that sales had risen 5.7% on a like-for-like basis against the previous year. That last result is reported after adjustment for currency effects – without those stripped out, Givaudan’s sales increased by 8.4% from the first nine months of 2017.
In its press release, the company said: “Givaudan continued the year with good business momentum and with the project pipeline and win rates sustained at a high level. This good growth was achieved across all product segments and geographies, with our key strategic focus areas on Naturals, Health and well-being, Active Beauty, Integrated solutions and local and regional customers delivering strong growth, complemented by the recent acquisitions.”
Key drivers of growth throughout the nine months have been the aforementioned trend towards the use of natural ingredients, as well as strength in Givaudan’s fragrances division. The company reiterated its goal of 4% to 5% sales growth on average over a five-year period to 2020.
Dominion holds Givaudan in its Global Trends Managed Fund.
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